Outcomes-Based Funding: Design Principles and State Examples Outcomes-Based Funding: Implementation in Massachusetts Richard Freeland, Commissioner Massachusetts Department of Higher Education 1

Process and Impacts of Performance Funding: The Massachusetts Experience

3  Inclusive engagement of all community college Presidents  Facilitated over a 3 month process by an outside expert – Dennis  Charge to the Planning Group:  1. Strong emphasis on completions to meet needs of the labor market and the goals of the Vision Project  2. Address significant inequities in existing funding structure  Ensured metrics were in alignment with Vision Project goals  Reached collective agreement on formula Getting to the Funding Formula Process of the Planning Team

4 Base Funding The added emphasis on “non- credit workforce” training was recommended by Labor and Workforce Development and Housing and Economic Development Basics of the Formula  Student Credit Hours Completed  Non-Credit Workforce Enrollments Community College Funding Formula Performance Funding Weighted by field for COST of delivery  College Completion Variables Weighted for PRIORITY fields and PELL-eligible students +

5 College Completion Metrics include several proxy measures of institutional effectiveness in encouraging students to achieve successful outcomes. College Completion Metrics Certificate Completion Weight10% Associate Completion Weight15% Transfers Above 24 SCH Weight5% 30 Credits Hours Weight5% Completions: English Weight7% Completions: Math Weight8% Awards per 100 FTE5% ATD Success Rate (3 Year Average)45% # of completed certificates # complete 30 credits in any given year # completing a credit-bearing course in English degrees and certificates per (FTE) students Achieving The Dream “Success Rate” # of associates degrees # who transfer having completed 24 credits # completing a credit-bearing course in Math College Completion Metrics Performance Funding

6 areas of performance relevant to The Vision Project and the Governor’s goals Alignment WEIGHTS applied to completions Performance Funding  AT RISK MULTIPLIER : PELL ELIGIBLE 2.0  PRIORITY CERTIFICATES* 1.3  PRIORITY ASSOCIATE DEGREES* 1.3 Completions x WEIGHT

7  Strategies became more focused  Funding was reallocated to mirror enrollments & priorities of Vision Project  Collaboration across campuses (regionally and system-wide) increased significantly  Action oriented implementation to scale best practices Impacts of the Funding Formula Campus Level

8  Executive and legislative relations improved  Transformed perception of the community colleges  Created pressures on other levels of higher education to implement  Scaling of best practices across higher education and in concert with other state agencies  Transformation Agenda (Round 1 DOL TAACCCCT funded)  Guided Pathways to Success (DHE and Complete College America) Impacts of the Funding Formula Systems Level